Mixed Reactions to the Unified Pension Scheme among Trade Unions

Central trade unions have expressed a variety of opinions regarding the newly introduced Unified Pension Scheme (UPS), with many awaiting further details through an official notification. They are particularly interested in understanding the specifics of the lump-sum payment at retirement, potential future revisions, and tax benefits associated with the scheme.

Shiv Gopal Mishra, the secretary of the Joint Consultative Machinery (JCM), acknowledged the positive aspects of the UPS during a press conference in New Delhi on August 25, 2024. He stated that the scheme would have retrospective effect, meaning that individuals who joined after January 1, 2004, and retired under the National Pension System (NPS) will now be eligible for benefits under the UPS.

Mishra also mentioned the improved provisions for family pensions, noting that families of deceased pensioners will receive 60% of the pension. Additionally, the UPS guarantees a minimum pension of ₹10,000, indexed to inflation. He emphasized that while the UPS shares 90% of its provisions with the old pension scheme (OPS), its contributory nature—which requires employees to contribute 10% of their salaries—is a notable difference.

The Bharatiya Mazdoor Sangh (BMS), a trade union linked to the Sangh Parivar, also expressed support for the UPS. BMS general secretary Ravindra Himte indicated that the government is attempting to address the shortcomings of the NPS through the new scheme. However, he pointed out that certain features, including the commutation of pension and details regarding lump-sum payment ratios, remain unclear. He called for an increase in the minimum pension under the Employees Pension Scheme-95 from ₹1,000 to ₹5,000 and its linkage to the Consumer Price Index.

In contrast, central trade unions aligned with the opposition voiced strong opposition to the UPS. The Hind Mazdoor Sabha (HMS), which Mishra is a vice president of, criticized the scheme as an attempt to mislead employees. HMS general secretary Harbhajan Singh Siddhu argued that if members of parliament and state legislatures receive pensions without making contributions, it is unjust to deny similar benefits to government employees.

Leftist unions, including the Centre of Indian Trade Unions (CITU) and All India Trade Union Congress (AITUC), also expressed skepticism towards the new scheme. CITU general secretary Tapan Sen accused the Modi-led NDA Government of prioritizing the interests of wealthy investors by modifying benefits while imposing additional contributions on employees. AITUC general secretary Amarjeet Kaur further claimed that the scheme promotes speculative market activities, urging the government to significantly increase its contribution to the pension plan.